OIL futures rose yesterday as energy supplies were tight with US-Iran peace talks stalled while Wall Street equity indexes inched down as investors looked cautiously ahead to a busy week of megacap earnings reports, economic data and central bank decisions.
Brent futures rose $3.13, or 3.0 per cent, to $108.46 a barrel yesterday evening, while US West Texas Intermediate (WTI) crude rose $1.80, or 1.9pc, to $96.20.
While worrying about the war, investors also waited with bated breath for economic data and earnings reports, according to Phil Blancato, chief market strategist at Osaic Wealth in New York. This week’s data will include first-quarter US economic growth and the March Personal Consumption Expenditures Price Index, which is the Federal Reserve’s preferred gauge for inflation.
Capital expenditure plans will be a key focus for firms such as Microsoft, Alphabet, Amazon and Meta Platforms when they report quarterly results tomorrow, while Apple is scheduled to release results a day later.
On Wall Street, the Dow Jones Industrial Average fell 152.37 points, or 0.31 per cent, to 49,079.18, the S&P 500 fell 12.12 points, or 0.17pc, to 7,153.03 and the Nasdaq Composite fell 88.59 points, or 0.35pc, to 24,748.79.
MSCI’s gauge of stocks across the globe rose 0.66 points, or 0.06pc, to 1,072.86 while the pan-European STOXX 600 index fell 0.38pc.
In currencies, the US dollar slipped yesterday as investors were on edge about the Middle East and a slate of central bank meetings later this week. The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, fell 0.26pc to 98.38, with the euro up 0.11pc at $1.1733. Against the Japanese yen, the dollar weakened 0.08pc to 159.24.
Major central banks are expected to keep policy on hold this week, including the US Federal Reserve. The Fed’s meeting, which runs today through tomorrow, will likely be the last with Jerome Powell as Chair. The first central bank to meet will be the Bank of Japan, which is expected today to keep its short-term policy rate steady at 0.75pc while the European Central Bank and Bank of England are expected to keep policy unchanged.
In the bond market, US Treasuries sold off ahead of a wave of issuance on the front end of the curve that is expected to once again test demand for the country’s government debt.
The yield on benchmark US 10-year notes rose 2.3 basis points to 4.334pc, from 4.31pc late on Friday while the 30-year bond yield rose 2.5 basis points to 4.9409pc.The 2-year note yield, which typically moves in step with interest rate expectations for the Federal Reserve, rose 2.8 basis points to 3.804pc.
In precious metals, gold eased as high oil prices fanned inflation concerns.
Spot gold fell 0.88pc to $4,667.24 an ounce. US gold futures fell 0.61pc to $4,693.40 an ounce.
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